Macroeconomics Homework HELP! Please!?

Posted on 2014-04-11 10:27:00 in Economics by ROYALTY

Assume that C=100+0.8Y. Furhter assume that planned investment I=25, government purchases G=45, exports X=50, and imports M=60.



a.What is the level of autonomous expenditure?

b. Calculate the equilibrium level of GDP. How much is spent on consumption when GDP is at equilibrium?

c. What is the spending multiplier?

d. Assume the government imposes a lump-sum tax T=50 on all levels of income. What will happen to the equilibrium level of output? What is new consumption expenditure?

e. What is the tax multiplier?

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